Unemployment rate drops to 9.1 percent

Unemployment eased unexpectedly to 9.1 percent in July, but after a morning surge a nervous stock market seesawed as investors fretted about the chances of a global economic downturn.

The Labor Department announced Friday that 117,000 jobs were added last month, initially causing the Dow Jones Industrial Average to climb more than 150 points before it succumbed to a jarring volatility. The Dow closed up 61 points for a 0.54 percent increase.

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Goolsbee on jobs numbers

Kerry on double-dip recession

POLITICO 44

In a Friday speech at the Washington Navy Yard, President Barack Obama stressed that the economy was his “singular focus” and called for a bipartisan effort to ignite job growth.

“There is no doubt this has been a tumultuous year,” the president said. “We’ve got to be able to work together to grow the economy, right now, and strengthen our long-term finances. That’s what the American people expect of us — leaders that can put aside our differences to meet our challenges.”

A morning dip in the market appeared to be related to fears by traders that ratings agency Standard & Poor’s might still strip the United States of its top-notch credit rating, even though the nation averted default with a debt ceiling compromise. An S&P spokesman declined to comment.

An afternoon rally seemed to ride on signs that the debt crisis in Italy and Spain would be contained by the European community, with Italian Prime Minister Silvio Berlusconi pledging on Friday to introduce a balanced budget amendment to his country’s constitution.

The U.S. jobs numbers were better than had been anticipated. Forecasts ranged from 50,000 to 100,000 new jobs, but the underlying data suggest an economy that remains dangerously hobbled.

Unemployment largely fell because more Americans are leaving the workforce, with an already low labor participation rate falling from 64.1 percent to 63.9 percent.

“The headline number looks OK, but the moment you see that the labor participation rate has eroded further it’s not a positive,” said Jason Schenker, president of Prestige Economics.

On Thursday, debt worries in Europe coupled with a series of negative reports about the U.S. economy had led the Dow Jones to plummet more than 500 points. During the past month, a steady downturn has wiped out stock market gains from the past year.

In all, 154,000 private-sector jobs were created in July, up from 80,000 in June. Manufacturers added 24,000 jobs, retailers hired a total of 26,000, and the health care sector added 31,000 jobs.

Government payrolls, meanwhile, were slashed by 37,000 jobs in July, led by 23,000 jobs lost in Minnesota during that state’s now-resolved government shutdown.

In June, the unemployment rate was 9.2 percent and the economy gained a worse-than-expected 18,000 jobs. On Friday, the June total was adjusted upward to 46,000 and the May total of 25,000 was readjusted up to 53,000. In February, March and April, jobs growth averaged about 200,000 each month.

Just to bring unemployment below 8 percent before the 2012 presidential election, the economy would have to create an astonishing 272,000 jobs a month, according to estimates by Hamilton Place Strategies partner Matt McDonald.

In Austan Goolsbee’s last day as chairman of the president’s Council of Economic Advisers, he told Bloomberg TV on Friday that Washington — though not the White House — has been part of the problem in creating jobs.

Do you even know how many jobs per month would need to be created, and for how many years it would take SUSTAINED job growth at that level WITHOUT FALTERING - just to reach unemployment neutral?

Not even close to the 500,000 jobs per month in the private sector that it would take to quickly wipe out widespread unemployment and help reduce the dangerously out of control debt - or at least slow it down.

So ...Things are looking up for the US Economy . This must be a Bad day for Republicans , I wonder what they are going to do and say today . The last time unemployment ticked up , they were all over the blogs jumping up and down..

Every day is a bad day for the nation and the world under this pack of incompetent Pigressives. This type of "growth" ain't gonna cut it in the real world. The US economy expanded at a rate of less than one percent the first six months of this year. Just what exactly is Obama's plan besides running his mouth - to get a rapid booming economy, prosperity and wealth generated? Oh that's right, the community organizer doesn't have a plan and he's in over his head.

"The political problem for President Obama? Even if 100,000 jobs are created, it will be less than half the number of jobs — 255,000, — that need to be created every month for the unemployment rate to dip below 8 percent by Election Day 2012.

And there’s very little historical evidence of a president — of either party — winning a second term with unemployment at those heights.

Summers added that there is “at least” a one- in-three chance that the economy could fall back into recession “if nothing new is done to raise demand and spur growth.”

..........The rate dropped from 9.2% because too many Americans have given up HOPE and left the job market........